A technique to culture rabbit endometrial cells in chemically defined medium has been developed. Diethylstilbestrol and natural estrogens were found to promote cell division, while progesterone has an opposite effect on these parameters but it was found to be necessary for the synthesis of blastokynin. The sex hormones regulate the cell cycle of the cells, which were found to be either noncycling (G0) or cycling. Both cell populations were isolated and it was found that the G0 cells were the target of estrogens. Interaction between progesterone and the cycling cells was necessary to obtain an antagonistic effect on the estrogen effect on the G0 cells. A hypothetical model for the hormonal regulation of cell proliferation and differentiation through control of hormone receptors is proposed. We will continue to study our experimental system by analyzing the mechanism of action of sex hormones, epithelial growth factor, and prostaglandin F2alpha in regulating proliferation, cell cycle, blastokynin synthesis (by radioimmunoassay and immunohistochemistry) and hormone receptors. The endpoint of our research is to improve our comprehension of the mechanisms by which sex hormones regulate proliferation and differentiation of endometrium. It is expected that the study of our hormone-responsive system will help to advance the understanding of the etiology and pathogenesis of endometrial carcinoma in particular and hormone-related cancer in general.